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Updated almost 4 years ago on . Most recent reply
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Stockbridge MI fix & flip
Investment Info:
Single-family residence fix & flip investment in Stockbridge.
Purchase price: $98,000
Cash invested: $45,000
Sale price: $197,000
Contributors:
Donovan Clock
1920’s complete gut and remodel including a finished basement. Turned out beautifully. The 2 deals fell through due to buyer complications and an awful appraisal but we finally made it and turned a nice profit!
What made you interested in investing in this type of deal?
The home was structurally sound but cosmetically out of date.
How did you find this deal and how did you negotiate it?
It was a foreclosure on the MLS. We were the first bid and came in at asking price due to the busy market we were in.
How did you finance this deal?
Conventional loan 5% down
How did you add value to the deal?
We finished the basement, removed an old shed and trellis as well as adding vinyl siding and completely rehabbing the entire home and garage.
What was the outcome?
We had a second appraisal come in $20,000 lower on an FHA deal that fell through. Once we got it back under contract for and RD loan, the lenders and underwriters were swamped which caused further delays. Ultimately we made a nice profit, it just took some time to get there.
Lessons learned? Challenges?
Have the appraisal FIRST before inspections. This would have saved us at least a month of time.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
I am a real estate agent, we had difficulty with Howard Hanna's in-house lender AND their title company. My lender through union home mortgage was processing FHA and RD loans in half the time this lender was.
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